Does Driving-day Based Tradable Credit Scheme Outperform License Plate Rationing

This article models a novel driving-day based tradable credit scheme(DD-TCS)in managing urban traffic congestion.In this model,car-using allowances(in terms of number of days in a month;termed as “credit”)are freely and uniformly allocated to all travelers,who are also allowed to trade them in a market according to his/her travel needs(e.g.,driving more days or fewer than the free endowment).As opposed to most studies on TCS,this paper explicitly considered the transactions cost(e.g.,information cost of finding the potential traders)in the trading market.To assess the feasibility of TCS,we compare against License Plate Rationing(LPR),which has been practically implemented in many cities(e.g.,Beijing and Chengdu,China).Taking the performance of LPR as a benchmark,we quantify the threshold values of the transaction cost in DD-TCS when the two schemes yield equivalent performance(in terms of the total generalized cost).In numerical studies,we also compare the DD-TCS and LPR with the do-nothing case and the congestion pricing case(representing the theoretical optimum).Results show that both DD-TCS and LPR outperform the do-nothing case under certain condition.With small transaction cost DD-TCS may achieve lower system cost that can be very close to the ideal optimum.In addition,parameter analysis shows that DD-TCS perform better than LPR in a wide range of transaction cost,of which the threshold values appear to account for a considerable portion of the auto travel time.It is implied that DD-TCS will be highly likely more appealing than LPR in practice because a lower transaction cost than the extreme large threshold values can be easily achieved for the trading market(e.g.,mobile platform and modern communication techniques).